John: Yesterday, Currie Rose Resources (CUI, TSX-V) opened at 18 cents, fell as low as 17 cents and then climbed and closed at its high of 18.5 cents. That was a gain of half a penny for the day on CDNX volume of 702,000 shares. Currie Rose has traded between 17.5 and 18.5 cents so far today through 10:05 am Pacific, the time of this posting. It is presently off a penny at 17.5 cents but the chart is looking very favorable as outlined below.
Looking at the 4-month daily chart, we see that the stock price rose to a high of 47.5 cents in December. This move started in July at 4 cents (not shown on the chart). From the high in December the price retraced to a low of 15 cents, clearly oversold as indicated by the RSI and Slow Stochastics, before rebounding to a high of 22.5 cents on February 2 to eliminate the oversold condition. This retracement to 15 cents was equal to a 61.8% Fibonacci retracement of the previous move up which validated the retracement (if the retacement had exceeded the 61.8% it would have been classed as a failure and its low would have been suspect).
For the last 8 sessions the price has traded in a horizontal trend channel bounded by the top blue line and the green bottom support line. The candles for the past 2 days have been bullish hammers and the volume has also increased for the last 2 days. It’s lighter so far today. There is a resistance band between 20 cents and 22.5 cents with additional resistance levels at 29 cents and 37.5 cents (blue horizontal lines). Strong support exists at the 15 cent level (horizontal green line).
Looking at the Indicators: The RSI has formed a flat “W” formation at the 45% level – bullish.
The Slow Stochastics have also formed a flat “W” formation with both the %K and the %D at 37% – bullish.
The Chaikin Money Flow indicator shows the selling pressure is declining (sloping mauve line).
Outlook: The chart pattern, volume and indicators are all very favorable here and suggest the potential for a significant upside in Currie Rose in the near future.
Note: The writer holds a position in Currie Rose Resources.
